Saturday, November 03, 2012

Proposition 37 is a crystal clear example of rent seeking in
the food industry. Some natural and organic and other food special interests are
utilizing this legislation to obtain market share that they otherwise would
not be able to obtain through the marketplace. To see this, its important to understand the dynamics of the
market for sustainable ag products as it has evolved over the last 15 years.

While most members of the agriculture industry don’t think the industry should be defined by an ‘us vs. them’ paradigm, some are willing to exploit
consumer fears and asymmetric information by using the government’s regulatory
apparatus to get a competitive edge. Some see modern ag as a competitor as
opposed to a partner in an overall mission to provide the world with safe
sustainable food. Consumer apathy also works against some promoting niche
organic and natural markets. Uncaring customers represent lost revenue potential. A
scary Hollywood horror movie label like ‘genetically modified’ may be enough to drum up business. How?

The Role of
Information Asymmetry

Whenever one party has better information about their
product or service than the buying public, information asymmetries may
exist.Proponents of proposition
37 claim that their initiative is to reduce information asymmetry and improve
the functioning of markets, as stated in this recent Forbes article:

“Free markets only
work when there is transparency and people are able to make decisions based on
information, which does not exist in the case of GMOs. If Prop 37 is enacted,
and, armed with this information, a significant enough number of consumers
decide not to buy these products, the onus will be on the companies to conduct
more research and produce better data.”

Will including the words ‘Genetically Modified’ on food labels really serve to inform
the public or create more confusion?This form of labeling won’t do any thing to decrease
information asymmetry in and of itself. The actual language in the law may in fact make it worse.
This is made clear on page 10 of a report byNorthbridge EnvironmentalManagement Consultants (The Genetically Engineered Foods
Mandatory Labeling Initiative Overview of Anticipated Impacts and Estimated
Costs to Consumers):

"The Genetically
Engineered Foods Mandatory Labeling Initiative (A.G. File No. 11-0099 –
hereinafter the Initiative) would have a substantial impact on California
consumers. The Initiative would change how many of the foods they eat are
produced and would make that food more expensive. At the same time, however,
the Initiative would provide relative little by way of consistent and useful
information to consumers because of the loopholes and exceptions in its
language and the uneven ways in which it would apply to the same food consumed
in different settings. "

If informing consumers were the primary goal, then there are
much more intelligent ways to do so, perhaps in the ingredients listing
following industry standards (instead of using ‘genetically modified' if a product contains GMO corn, list instead ‘rCORN’, an idea I reluctantly entertain here) If
it alarms otherwise apathetic consumers, are they really going to invest the
time researching the safety of biotech foods to close the information gap or are they going to turn to the unqualified opinions of
celebrities like Dr. Oz or Oprah? I would bet that the special interests are counting on
consumers weighing heavily the opinions of celebrities and conspiracy theorists,
and therefore letting the information asymmetries associated with biotech
direct them to their own products.In this
way, Prop 37 is specially designed by special interests to take advantage of information
asymmetries and exploit the fears of the public in an effort to drive market
share.

***UPDATE

Here is a link to a great interview from Berkeley professor of Molecular and Cell Biology Michael Eisen via the Foodstuff's FoodLink Food and Farm Podcast with Ray Bowman that highlights the information asymmetry, special interests, trivialization of science, and near conspiracy theory aspects of Proposition 37.

Tuesday, October 09, 2012

The merits of the US IPR system are debatable, but that doesn't make Monsanto any different than Apple. Saved seed is genetically copied and freely distributed intellectual property. If its not OK to copy and distribute freely the iPad OS, then it's not OK to do it with Roundup Ready soybeans. You either accept IPR or not, which again is a debatable concept. But if you reject that IPR is really 'property' as some economists do, then your beef is with the US government, not specifically Monsanto. It just puts Monsanto and Apple in the same boat. Apple has the advantage that it's much harder to copy and distribute their OS than it is to copy the OS of a self pollinated plant, so enforcement costs illicit different tactics from different companies. i.e. Monsanto gets more attention from the far left as they hold hands with far right wing conspiracy theorist counterparts that have somehow convinced themselves that it is OK to restrict 'economic' freedom to promote 'food' freedom (i.e. prop 37, gmo bans, etc)

Monday, October 08, 2012

Farm Food Freedom KY is a KY based interest group that has gotten some attention from a few of our lawmakers in Frankfort. But, are they really interested in economic freedom for all KY farmers? Do they support the current heavy regulatory burden faced by most KY farmers? Would they actually support more interventions that would burden farmers and limit consumer choice? Why do they consider big government left wing special interests to be among their national allies? Well, let's ask and see. I contacted the administration at fffky and asked them the following questions:

1) What is your definition/conception of 'food' freedom and how is it similar to or different from 'economic' freedom?

2) Your page does a good job highlighting many food freedom related issues such as the regulations that hinder the sale of raw milk and other locally sourced food products. However some of the tweets posted on the http://www.fffky.org/contact-us/ web page (which I assume @FarmFoodFreeKy is your official twitter account) are critical of GMO foods. Particularly one tweet states that the U.S. is behind with regard to a ban on GMO foods in France. Seehttp://t.co/xkLVrZtF . Other tweets also seem to support Proposition 37 in California, which seeks to require mandatory labeling of GMO foods.

a. Would you support a similar labeling requirement in KY similar to California's Proposition 37?b. Do you feel we need less regulation of locally sourced foods (like raw milk, processed meat etc.) but more regulations or even bans on GMO foods?

"To stop GMOs from being planted or pursued in the great Commonwealth of Kentucky."

Is this mission primarily about consumer education and persuasion or would you consider legislative or regulatory approaches to reduce the planting of GMO crops in KY?

4) If you agree with the mission statement, how would a mission to stop GMOs in Kentucky be consistent with the food and economic freedoms of the many family farmers that rely on corn and soybeans that utilize this technology?

5) On the fffky.org website, there is a section titled 'National Allies' and a link labeled 'like minded sites.' Among these include links to CSPI (Center for Science in the Public Interest), EWG, and HSUS. These groups have not historically been friendly to agriculture (i.e. CSPI supports NYC's soft drink regulations, EWG campaigns for less meat consumption, and HSUS supports initiatives to increase regulation of family owned livestock farms).

Why do you consider these groups to be 'like minded' even though they support initiatives and regulations that limit consumer choice and economic freedom as it relates to food an agriculture?

Wednesday, September 19, 2012

"The Genetically Engineered Foods Mandatory Labeling Initiative (A.G. File No. 11-0099 – hereinafter the Initiative) would have a substantial impact on California consumers. The Initiative would change how many of the foods they eat are produced and would make that food more expensive. At the same time, however, the Initiative would provide relative little by way of consistent and useful information to consumers because of the loopholes and exceptions in its language and the uneven ways in which it would apply to the same food consumed in different settings. "

Thursday, September 06, 2012

"Carson exploited her reputation as a well-known nature writer to advocate and legitimatize "positions linked to a darker tradition in American environmental thinking....But the fears she raised were based on gross misrepresentations and scholarship so atrocious that, if Carson were an academic, she would be guilty of egregious academic misconduct."

Thursday, August 09, 2012

"Scholars who have designed taxonomies to point out the difference between open access arrangements and common property have sometimes distinguished four very general "types" of property: public, private, common and open access. This classification unfortunately creates the erroneous impression that common property is not private property and thus does not share in the desirable attributes of private property. It is crucial to recognize that common property is shared private property and should be considered alongside business partnerships, joint-stock corporations and cooperatives."

McKean, M. and E. Ostrom (1995) ‘Common Property Regimes in the Forest: Just a Relic from the
Past?’, Unasylva, 46 (180): 3-15;

Friday, June 29, 2012

Pending Thursday's supreme court decision on the Affordable 'Care' Act, auto industry, labor, environmental, and banking related interests are swamping DC offices to encourage lawmakers to pass what they term The Affordable 'Car' Act. Supporters are calling this bill a win-win for consumers, labor, and the environment.

Under the proposed plan, auto owners will be required to own or purchase at least one hybrid powered vehicle. Failure to do so will result in a financial penalty yet to be determined. Supporters insist the penalty is not a tax, but the program will be administered and fines collected by the IRS, making the new law constitutional in light of the court's recent decision.

Revenues collected will be used to subsidize the purchase of hybrid cars (through loan guarantees) to help low income car owners make the switch. Additional funds will be allocated toward making autoworker pensions solvent, as well as funding R&D for additional hybrid technology research.

The Occupy Wall Street movement offers the follwing praise: "In a post Citizens United world, where we are used to victories for big business, bankers, and special interests, this is one for the people."

Monday, June 25, 2012

Is there justification for government intervention requiring
labeling of GMO foods?

In a post from a few years back, I looked at the role of government with regard to smoking bans. I asked, when should personal decisions
become government decisions? In order to decide this, I identified three
questions that should be asked.

Is there an uncompensated harm?

Is there sufficient information so that citizens can recognize the potential harm?

“Characterisation of GM crops is a
legal requirement, however. As a result GM crops are better characterised than
ever before in the case of conventionally bred crops, including knowledge on
the site and nature of the genetic modification.” (1)

So in terms of uncompensated harm, government intervention does not pass the
first hurdle for justification. Given
that we can’t scientifically affirm that GMOs impose increased
risks over traditional plant breeding methods, it may not be relevant to
consider the next question. One might certainly argue that there is a degree of
widespread ignorance related to the use of biotechnology in food production. It is a
fact that 98% of all farms are family farms, and 70% or more of the corn and
soybeans grown on these farms is of GMO origin. Perhaps more could be done to make consumers more aware of this fact, but it seems like it could be achieved very easily
through marketing and consumer education without government
intervention. This brings us to the last question- does the market provide a
way to avoid the harm? Again, without scientific evidence of harm, this
question seems irrelevant. But if we want to assume that there is some remote
chance of harm, the market has various mechanisms for avoiding GMO foods via
organic and other branding options. Except for the most zealous advocates of
government intervention in the market, it seems the case for it is quite weak.

What if people just want labels for other reasons?

In some cases, people are not opposed to GMOs for just health reasons, but
they don’t approve of the business practices of companies Monsanto. First
off, labeling seems like a blunt tool to punish one company, as it could
penalize the many companies in the biotech industry, as well as the family
farms that overwhelmingly choose this preferred production method. Secondly, the U.S. constitution and legal
precedent may establish a role of government to establish weights and measures but this does not justify the use of labels on the basis of personal or
political preferences. Personal food preferences should not be expressed in the voting booth, but through the market.

Could labeling do more harm than good?

Given the gate to plate nature of the agricultural industry, false consumer
perceptions can actually do a great deal of harm to family farmers. For
instance, misconceptions about finely textured beef lead to huge losses in
cattle markets and 800 or more jobs in the beef industry. Or take the case of
high fructose corn syrup (HFCS). Due partly in response to government
intervention through sugar tariffs as well as technological advances, this new
sweetener was produced by increasing fructose levels in corn syrup. The end product
was technically higher in fructose compared to normal corn syrup, but it did
not represent a ‘high fructose’ sweetener relative to other sweeteners such as
ordinary table sugar. At the time listing the technical name ‘high fructose
corn syrup’ in the ingredients of food products seemed harmless enough.
However, recently many misconceptions about HFCS have made their way into the
media, despite the evidence to the contrary. Similar to finely textured beef or
HFCS, listing or labeling GMO ingredients could have a similar effect on
consumer sentiment if this conveyed a false sense of risk or harm
associated with GMO foods. This could not
only have a negative impact on family farms that depend on this technology, but
a government incentivized drop in consumer demand for GMOs through labeling would also imply a loss
of the actual environmental and safety benefits of this rather green technology.

If government intervention to label GMOs were justified, how would we do it?

Playing devil's advocate, what kind of labeling would make sense? What about
the current proposal
in California?

“Commencing on July 1, 2014, any food
offered for retail sale in California is misbranded if it is or may have been
entirely or partially produced with genetic engineering and that fact is not
disclosed . . . with the clear and conspicuous words Genetically Engineered on
the front of the package.”

This seems to be the worst example of what would be an acceptable labeling
initiative. First off, placing the words ‘Genetically Engineered’ on the front
of the package seems a bit extreme, and could easily be used by anti-biotech
factions as a marketing ploy to mislead consumers. The very thought of making
it conspicuous is a blatant indicator
that this initiative is more about political and consumer manipulation and less
about disclosure of information. If identification of GMO origin is to be noted on food
packaging, the appropriate place would be more inconspicuous within the
ingredients listing. GMO products are used widely in the pharmaceutical
industry and they have already set a precedent for how these products could be
labeled.

For example, pharmaceuticals produced via biotechnology follow a common
naming convention: name (rDNA origin).
The ‘rDNA origin' indicates that the drug was produced through recombinant DNA
technology. Food products manufacturers could follow a similar protocol:

Bovine Somatotropin is a currently used biotech product used in dairy
production, and is often simply referred to as rbST. Instead of following a
biotech food ingredient with (rDNA origin) it may be simpler to just prefix the
ingredient with an ‘r’ as such:

This approach would identify GMO food ingredients without explicitly
creating unwarranted alarm or attention. Concerned consumers could simply read through the many ingredients listed and look for the 'r' ingredient prefix or (rDNA origin) suffix. However, this should still be
approached with extreme caution, as simply agreeing to list GMO ingredients
this way admits to some extent that GMO products merit some reason for being
identified in food, which again the neither science nor libertarian principles
for government intervention seem to justify. As previously stated, with only a little consumer education, consumers could easily be made aware of the prevalence of GMO ingredients in food products without reading ingredients lists. Formally identifying these ingredients in any way would seem to only serve the political ends of manipulating the free choices of consumers and producers from gate to plate.

UPDATE: I highly recommend the following video that also makes a compelling case for libertarian and free market advocates to oppose mandatory GMO labeling.

1- European Commission (2010) A decade of EU-funded GMO
research (2001–2010). Luxembourg, Belgium: Publications Office of the European
Union.

Hopefully this will not have any additional negative impacts. But one thing this brings to light are numerous amounts of research related to the potential dangers associated with natural plant biochemical processes and traditional non GMO based plant breeding.

"Characterisation of GM crops is a legal requirement, however. As a
result GM crops are better characterised than ever before in the case of
conventionally bred crops, including knowledge on the site and nature
of the genetic modification....molecular biology techniques are producing less side-effects than classically used techniques""

"Conventional breeding techniques, accepted as safe by all, cause much more
genetic disruption than those introduced by genetic engineering, and the
resulting plants are not tested extensively for genetic change nor for safety
attributes using the rigorous standards applied to genetically engineered
plants.”

Thursday, June 21, 2012

“It is certainly true that crop breeding
changes DNA; in fact, that is the purpose of all breeding programs—to create
differences in DNA. Campaigners who are opposed to GM crops consistently
point to the potential harmful effects of DNA inserts, and the potential
presence of multiple fragments of new DNA in a transformed plant. There
are several problems with their assertions: 1) All plant chromosomes are
repeatedly disrupted by many structural changes to DNA that have occurred in
plants repeatedly over the course of recent history, and still occur today when
plants are grown each season in the field; 2) All breeding technologies produce
numerous changes and disruptions to the structure of plant chromosomes; 3)
Conventional breeding techniques, accepted as safe by all, cause much more
genetic disruption than those introduced by genetic engineering, and the
resulting plants are not tested extensively for genetic change nor for safety
attributes using the rigorous standards applied to genetically engineered
plants.” “Indeed, the use of more precise technology
and the greater regulatory scrutiny probably make them even safer than
conventional plants and foods; and if there are unforeseen environmental
effects – none have appeared as yet – these should be rapidly detected by our
monitoring requirements. On the other hand, the benefits of these plants and
products for human health and the environment become increasingly clear.” (
European Commission 2001)

Kato A and others (2004). Chromosome painting using repetitive DNA sequences
as probes for somatic chromosome identification in maize. Proceedings of
the National Academy of Sciences of the USA 101(37): 13554-13559 www.pnas.org/content/101/37/13554

McHughen A (2000). A Consumer’s guide to GM food : From Green Genes to Red
Herrings . (Published as Pandora’s Picnic Basket in the USA). Oxford. Arguably
the best book for the general reader about whether it is safe to eat the GM
food.

"In summary
(25), Cry1Ab has no characteristics associated with toxins or food allergens,
it has no peptide sequence homology with known allergens (26), it has no
N-glycosylation sites for a secondary immunization, it is rapidly degraded by
gastric and intestinal fluids, it has no side effects in mice force-fed orally
at a dose of 5 g / kg. So there is a reasonable certainty and there is no
documented adverse effects of the inclusion of Cry1Ab in the feed and food
(25). In this context, the first actual assertion of such an absorption in
humansrepresent or actually the first
one and should have made the Canadian authors particularly cautious, but this is
clearly not the case."

In ‘Maternal and fetal
exposure to pesticides associated to genetically modified Foods in Eastern
Townships of Quebec, Canada’ the authors claim to have identified the toxin
Cry1Ab in the blood of pregnant women. Cry1Ab is a protein produced by the bacteria Bacillus thuringiensis (Bt) that is
toxic to certain insect pests. Cry1Ab
is just one version (event) of this Bt toxin.
Bt toxins have been used extensively by organic farmers and
biotechnology has enabled seed companies to develop corn plants that express
Cry1Ab proteins giving them a built in defense mechanism against insects
susceptible to the toxin, while preserving the biodiversity of friendly
insects. Bt genetics have also been
incorporated into cotton. The economic, environmental, safety, and health benefits
have made this a very popular tool used
by the majority of family farmers.

One of the major criticisms of the article was the use of
the test used to identify the Cry1Ab protein. In the article the authors state:

There have been many criticisms of this article. Basic statistical techniques show that the ELISA test is one of the most unreliable methods for detecting Cry1Ab toxins. Dr. David Tribe and Dr. Cami Ryan have done a great job discussing the underlying science and peer review of this article as well. Digging into Dr. Tribe's commentary you can find a very well written peer review based criticism of this paper:

"In fact, a second category of doubts and questions arise in terms of immunological technique. Indeed, the only basis for the results presented is a double sandwich ELISA commercial test, decribed to be specifically for Cry1Ab (Agdia, Elkhart, IN, USA) (27). Many immunologists warn that such tests can yield not specifc results , especially in the presence of blood or serum proteins. Various ELISA tests are unusable in serum, due to non-specific binding, [? and variability within samples?] and from one individual to another (28 and unpublished results). These results and signals from non-specific enzymatic variables give exactly the same type of results as those reported by Aris and Leblanc (1). In addition, peroxidase type enzyme conjugates , such as that used in the Agdiatest , are particularly sensitive to this type of non-specific effect, generating false positive measurements(29). It has been made clear made clear by two users at least theAgdia test does not give reliable results in blood (16 33). Comparisons carried out by various authors between commercial sandwich ELISA (27,30,31) and various laboratory tests using anti-Cry1Ab polyclonal and monoclonal antibodies (32-36) demonstrate that the environmental tests of sandwich ELISA Cry1Ab to vary greatly in terms of sensitivity and specificity. Tests of this kind are particularly likely to yield non-specific false positive findings, especially in the presence of serum (37)."

Wednesday, June 20, 2012

Lots of times students complain that either their statistics
classes used silly examples that were too simple to ever be realistic, or that
their course was too complicated and thus they leave the class without the
capability of any practical application. A
recent study looking at the safety of GMO corn provides a great case study for
the practical application of the coefficient
of variation (CV).

"There is no significant risk to monarch butterflies from
environmental exposure to Bt corn, according to research conducted by a
group of scientists coordinated by the Agricultural Research Service
(ARS), U.S. Department of Agriculture. This research was published
in the Proceedings of the National Academy of Sciences (PNAS)."Link

Lowndes J, et al.
June 2007. The Effect of High-Fructose Corn Syrup on Uric Acid Levels
in Normal Weight Women. Presented at the June 2007 meeting of The
Endocrine Society. Program Abstract #P2-45. Abstract available.

Zukley L, et al.
June 2007. The Effect of High Fructose Corn Syrup on Post-Prandial
Lipemia in Normal Weight Females. Presented at the June 2007 meeting of
The Endocrine Society. Program Abstract #P2-46. Abstract available.

Dairy Product Consumption and the Risk of Breast Cancer
Journal of the American College of Nutrition, Vol. 24, No. 6, 556S–568S (2005)
Published by the American College of Nutrition
http://www.jacn.org/content/24/suppl_6/556S.full

"It has been suggested in some reports that dairy product consumption may increase the risk of breast cancer.This review gives a brief overview of the etiology of breast cancer and in particular the roles of fat, bovine growth hormone, insulin-like growth factor-1 and estrogens. Evidence from animal studies and epidemiology does not support a role for fat in the etiology of breast cancer. The daily intake of insulin-like growth factor-1 and biologically active estrogens from dairy products is minute in comparison to the daily endogenous secretion of these factors in women, whereas bovine growth hormone is biologically inactive in humans. On the other hand, milk contains rumenic acid, vaccenic acid, branched chain fatty acids, butyric acid, cysteine-rich whey proteins, calcium and vitamin D; components, which have the potential to help prevent breast cancer. Evidence from more than 40 case-control studies and 12 cohort studies does not support an association between dairy product consumption and the risk of breast cancer."

Medical Associations and Scientific Societies Which Have Approved Human Safety of bST

National Institute of Health FAO/United Nations
American Medical Association Office of Technology Assessment
American Academy of Pediatrics American Dietetic Association
American Cancer Society American Society for Nutritional Scientists
Institute for Food Technologists American Dairy Science Association
Council of Agricultural Science and Technology American Society of Animal Science
American Society of Clinical Nutrition The Endocrine Society
US Department of Health and Human Services International Dairy Federation
US Surgeon General United Kingdom Medicines Commission
State Medical Associations Royal College of Physicians and Surgeons of Canada
World Health Organization American Council of Science & Health

"In a report from 2010, the EC summarized the results of 130 research projects involving more than 500 independent research groups and concluded that biotechnology is not per se riskier than conventional plant breeding technologies [2]. Further support for this position comes from the UK Farm-Scale Evaluation (FSE), which studied the potential impact of herbicide-tolerant crops on farmland biodiversity [7]. One insight from the study is that overall changes in agricultural management determine the impact of a crop on biodiversity, rather than the technology or breeding behind the crop itself [8]."

Drilling into the report we can get some of their specific findings related to the relative risks of traditional plant breeding techniques and natural mutations vs. modern molecular approaches:

Traditional vs. GMO Crop Safety:

"The safety of conventionally bred crops is based on a history of safe use. However some extremely rare cases have been reported where unintended effects (DNA rearrangements) have given rise to safety concerns. These were only identified once the crop was already on the market.

NOTE: THE ABOVE RISKS WOULD APPLY TO NATURAL, CONVENTIONAL AND ORGANIC , FOODS. THE RESEARCH FINDS THAT THESE REAL RISKS ARE MORE THOROUGHLY INVESTIGATED IN GMO FOODS:

Characterisation of GM crops is a legal requirement, however. As a result GM crops are better characterised than ever before in the case of conventionally bred crops, including knowledge on the site and nature of the genetic modification."

and

"the extent of modification of the proteomic and transcriptomic profiles is always equal or more important in ‘classical mutants’ than in their GM counterparts. This result strongly suggests that the way modification has been produced may influence the transcription pattern, and that molecular biology techniques are producing less side-effects than classically used techniques"

SO NOT ONLY ARE GM CROPS MORE THOROUGHLY SCREENED, THE RESEARCH SHOWS THAT THE TECHNIQUES USED ACTUALLY INTRODUCE LESS RISK THAN CONVENTIONAL, NATURAL, OR ORGANIC CROPS.

"Genetic Roulette is Jeffrey Smith’s second book in which he makes unsubstantiated claims against biotechnology. In it, he details 65 separate claims that the technology causes harm in a variety of ways. On these pages each of those claims – addressed in the same eight “sections” that correspond directly with the book – are stacked up against peer-reviewed science."

Results of a search of the PubMed
database for publications on feeding studies for GM crops.

By Dr. Christopher Preston,
Senior Lecturer in Weed Management,
University of Adelaide;
christopher.preston@adelaide.edu.au

Conclusion:

"There are at least 42 publications extractable from the PubMed database
that describe research reports of feeding studies of GM feed or food products
derived from GM crops. The overwhelming majority of publications report
that GM feed and food produced no significant differences in the test
animals. The two studies reporting negative results were published in
1998 and 1999 and no confirmation of these effects have since been published.
Many studies have been published since 2002 and all have reported no negative
impact of feeding GM feed to the test species. "

About Me

My primary interests are in applied econometrics with applications related to the interrelationships between genomics, nutrition, health, and the environment. I have a quantitative and analytical background in the areas of applied economics and statistical genetics. I leverage my training with experience in machine learning and predictive modeling using SAS, R, and Python to solve problems. I can understand complex research and discuss the application with a scientist, sales representative, or the customer whose problem ultimately drives the analysis. I can code my own estimators, execute SQL queries, parse text files, and visualize a social network.